How to settle your loan early

All about settling your loan and how to do it

Answers to all those questions you might have about settling your loan.

    Can I pay my loan off early?

    Yes, you can settle and close your loan account at any time during the loan term by asking us for an early settlement figure.

    If you’re looking to pay it off early but not all in one go, you can make additional payments with no fee at any time during your loan to help reduce your loan term.

      Is there a charge for settling my loan?

      Yes, there’s a fee of up to two months interest. But the full amount you pay back may also include an interest saving.

      There's no charge if you decide to reduce your term through overpayment.

        How much will I save on interest by settling my loan early?

        When you settle your account early, you’re reducing the length of time you are borrowing for. This means you may pay less interest, which would save you money overall.

        The amount you could save is unique to your loan and will vary depending on the size of your loan and how many payments you have left. When you request an early settlement figure we'll let you know how much you'll save.

          What is an early settlement figure?

          An early settlement figure is the amount you’d need to pay to settle your loan. It includes:

          • The balance remaining on your loan
          • The interest you’ll save from settling your loan early
          • An early settlement charge of up to two months interest
          How do I get an early settlement figure?

          Get in touch on Your Community, Facebook, Twitter or call us. We’ll let you know your early settlement payment amount, you can also ask us to send it to you through the post.

          Your settlement figure will be valid for 30 days from the date you asked for it.

            How long is my early settlement figure valid for?

            Your settlement figure will be valid for 30 days from the date you asked for it.

              How do I pay my early settlement figure?

              Once you’re ready, you can make your final payment by:

              • Bank transfer – pay straight from your bank to your loan using your Tesco Bank loan account details.
              • Online loan payment – this lets you make fast, simple loan payments.
              • By cheque - make it payable to ‘Tesco Bank’ with your loan account details written on the back. Please post cheques to Tesco Bank, Loans PO Box 27014, Glasgow G2 9FE.

              If you’d like to make a payment from an account that is not in your name or address, you can only do this by bank transfer or cheque.

              Once your payment has cleared we'll cancel your Direct Debit and close your account within 7 working days. We’ll send you confirmation of your account closure along with a closing statement in the post. It's important we have your correct address to get this to you. If you think it might be out of date you should update your personal details as soon as possible.

                What if I’ve made a payment since I got my early settlement figure?

                If you've made a scheduled monthly payment between the date you got your settlement figure and now, you should take off your monthly payment amount from your early settlement figure before you make the payment.

                Remember, your early settlement figure is valid for 30 days from when you ask us for it.

                  Should I cancel my Direct Debit once I’ve made my final payment?

                  No, we’ll cancel the Direct Debit for you as soon as your final payment has cleared. If you end up making an overpayment, we’ll return the money to you within 8 working days.

                    How is the interest fee calculated?

                    At the start of your loan, a higher amount of your monthly repayment is put towards repaying interest. But as time goes by, we start to use less of your monthly repayments to repay interest and more towards reducing the capital until your loan is completely repaid.

                    This means the early settlement fee of up to two months interest will vary in amount according to the size and time left on your loan at the time you choose to settle.

                      What happens when I make my loan settlement payment?

                      Once your payment has cleared we'll cancel your Direct Debit and close your account within 7 working days. We’ll send you confirmation of your account closure along with a closing statement in the post. It's important we have your correct address to get this to you. If you think it might be out of date you should update your personal details as soon as possible.

                      If you end up making an overpayment, we’ll return the money to you within 8 working days.